Buy a company with the Mega Millions jackpot

Forget buying a beachfront mansion or a Porsche. How about snapping up an entire restaurant chain or footwear maker?

By Kim Peterson Mar 29, 2012 1:56PM
The Mega Millions jackpot is climbing past $540 million, its largest payout ever.

And while the promise of gigantic riches has some people fantasizing about new homes, fancy vacations and luxury cars, we thought it might be fun to buy a company. Yes, an entire company.

Think of the investment potential: You take over a company that is producing real revenue and profit. The economy is recovering, consumers are spending again, and companies across all sectors stand to gain in value. And who wouldn't love the idea of being captain of a corporate ship, a business tycoon who can turn the Mega Millions jackpot into much more?

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Now, to be realistic, buying a publicly traded company is very difficult. A prolonged fight at the shareholder and board level would be all but guaranteed. But hey, we're just dreaming here. So let's go shopping for a company valued at less than $540 million. Here are some choices:

Famous Dave's (DAVE)
This barbecue restaurant chain has a lot going for it, including revenue growth of 5.8% over five years and 4.4% over one year. Its gross margin is 20.9%, according to the Motley Fool, and it offers a nearly 17% return on equity. Sure, other rivals have stronger growth, but Famous Dave's has kept business going through the recession. And hey, it's market value is only $88 million. A Mega Millions winner could snap this up and still buy that private island.

Hot Topic (HOTT)
This teen retailer has been on a tear lately, thanks to some sharp instincts and "The Hunger Games" movie. The chain sold out of most of its "Hunger Games" merchandise before the movie premiered, and smartly cleared out inventory before it had to run huge markdowns on Peeta beach towels. And here's an added plus for the $428 million price tag: Owning Hot Topic would give you a lifetime supply of Insane Clown Posse accessories.

Big 5 Sporting Goods (BGFV)
The last time I went into Big 5, I bought a plastic sled that lasted all of about 12 minutes on a snowy hillside. Instead of giving them a piece of my mind, why not buy the company? Big 5 has a market cap of just $174 million.

Blue Nile (NILE)
If you've had it with cheesy, overpriced jewelry stores at the mall, Blue Nile is here to help. The company sells high-quality jewelry for a decent price, and has high customer satisfaction rates. It has a great website to boot. Its market value is just under $460 million.

Calavo Growers (CVGW)
Haas avocados are the name of the game at this company, and if you've bought one recently, there's a good chance it came from Calavo. The company is expanding into higher-margin food items, including salsas, guacamoles and tortilla chips. For its recent quarter, Calavo's profit rose 16% and revenue rose 29%. The company is valued at $400 million.

K-Swiss (KSWS)
The revenue increases of 30% at this athletic footwear company lately are nothing to sneeze at. K-Swiss is a decent name, but management hasn't made the best decisions. The company is only valued at $148 million, and is often mentioned as a takeover target.

Maidenform Brands (MFB)
Fads will come and go, but there will always be a market for quality bras and underwear. This company has been on fire since turning its focus to shapewear; Maidenform now has a huge share of the figure-sculpting shapewear market. Lately, even men are buying shapewear to keep those love handles in check. Maidenform will take just about all of those Mega Millions winnings, but this company is on a roll.

So there's your shopping list. Which one would most appeal to you as a lottery winner?

VIDEO ON MSN MONEY

3Comments
Mar 30, 2012 9:56AM
avatar

NO!  you missed the sales picth!  you're expected to buy one of the noted company stocks listed above silly!  "they" all want your money, transaction fees, etc! 

 

(i agree - why buy into headachs from buying any company?  at best, start your own little company with a product YOU care about, not something someone esle launched)

 

Why on earth would anyone need to buy a company with that much money? You could live on the conservative investments{about 10 million a yr for the rest of your life} with out ever touching the principal.You buy a company you actually take a chance on losing it one day.
Mar 30, 2012 9:15AM
avatar
Why on earth would anyone need to buy a company with that much money? You could live on the conservative investments{about 10 million a yr for the rest of your life} with out ever touching the principal.You buy a company you actually take a chance on losing it one day.
Mar 29, 2012 4:00PM
avatar

Start your own corporations and sell stock.  How hard is it to imitate Facebook, McDonalds etc.

 

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